NEW YORK: US Treasury yields rose on Monday as rising stock and oil prices reduced demand for safe haven debt, ahead of an expected government sale of $88 billion in new short- and intermediate-dated debt this week.
Yields have risen from more than three-year lows reached on Feb 11 as oil and stock markets stabilized.
Oil prices gained on Monday after the International Energy Agency, the world's oil consumer body, said it expected U.S. shale production to fall this year and next, potentially reducing a glut in supplies that has driven prices to their lowest in over a decade.
"The market's trading a little bit weaker primarily because risk assets are outperforming," said senior government bond strategist at CRT Capital in Stamford, Connecticut. "Oil and stocks have been the big drivers over the past few weeks and we don't see a reason for that to change."
Benchmark 10-year notes were last down 4/32 in price to yield 1.76 percent, up from 1.75 percent late Friday.
New Treasury and corporate supply this week may also weigh on the market, with the U.S. government due to sell $26 billion in two-year notes on Tuesday, $24 billion in five-year notes on Wednesday and $28 billion in seven-year notes on Thursday.
Banks expect around $25 billion to $30 billion in new corporate supply this week, according to IFR.
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